Friday, January 02, 2009

The 90% Solution

Last month, new TiVo-based research was released that revealed that more than 90% of DVR users “almost always” or “always” fast-forward through commercials.

This is 20% to 30% higher than what previous numbers have indicated. And, only 10% away from the magic number of 100%.

According to other projections, 36% of TV homes will have DVRs by 2012. The math basically does itself – 36% of homes fast-forwarding through 90% of the advertising. Ouch.

And yet, according to an article in the New York Times, advertisers are putting their marketing dollars into national television at levels reminiscent of prosperous economic times.

Go figure.

It must be the delusional power of scale. According to one senior executive at a media buying agency, “The shoe hasn’t dropped yet.”

Really? I think this executive is wrong. The shoe has dropped. It just hasn’t hit the floor yet.

Cumulatively, the four broadcast networks are down 10% in actual live viewers, with ABC, NBC and FOX, all drawing around a million viewers less each night than they did last season.

According to the chief investment officer of another media agency, “When the economy goes into a recession, marketers are looking at ad platforms that generate the most efficiency.” I guess to this exec, having 90% of the commercials skipped is his definition of efficient.

We have all heard the following argument, spacious as it may be—that even when viewers fast-forward through commercials—the brand still registers. And, perhaps that is true. If so, and if presence rather than persuasion is what advertisers truly want, then why don’t they just run a logo rather than spending half a million dollars to produce a commercial?

Wouldn’t the result be the same?

Starcom, the world’s largest media agency—a company that buys TV time for a living—argues that while the TiVo data is correct, the data also reveals that only 10% of viewers cite commercial-skipping as the main benefit of having TiVo. 80% of TiVo owners say the main reason for owning a DVR is to record programs for later viewing.

C’mon, Starcom, tell the rest of the story. What you’re not saying is that most programs are recorded to be viewed later that same evening. In fact, many 30-minute programs are recorded only to be viewed 10 minutes after their original start time so that people can watch the program without commercials and still finish the show when it is normally scheduled to finish.

So, while the main, stated benefit of a DVR is to watch programs later, the main reason for watching programs later is to be able to skip the commercials.

At a rate of 90%, mind you.

I keep coming back to that number if only to see how much larger it will need to become before advertisers start admitting that the intrusive manner in which they impose advertising on viewers is no longer effective. And that scale has become, at best, a false god to kneel before.

Unfortunately, scale, like nicotine, is addictive. It’s what advertisers fall back on because they don’t know what else will work. Smokers might try lollipops or chewing gum, but sooner or later, most come back to cigarettes. Even though they know that smoking can kill them.

It basically says so right on the package.

Maybe most advertisers also know that continuing to run advertising that intrudes on programming in the hope of achieving some sense of scale, also runs the risk of killing their brand.

What if there was a warning label pasted across each TV media plan, saying something along the lines of lines of, buying this TV media proposal could be detrimental to the health of your brand?

Chances are, it wouldn’t stop advertisers from okaying the plan. But it might give the media agencies a legal out. “We warned you that it wouldn’t work,” they can say. After all, cigarette companies are being sued.

As we enter 2009, maybe we should look at the 90% figure as a blessing in disguise. For lack of a better name, call it the 90% solution. What it tells us is that the best we can hope to achieve is for 10% of the users of any platform to pay any attention to any advertising whatsoever.

Of course, since 10% is not a very large number, and large numbers are what make advertisers comfortable, then we will need to offer them something to aggregate. Something that can add up to a large number. Something like time spent with the message itself.

After all, not only can time spent be measured. It can also scale.

If 10% of a million viewers watch only ten seconds of a sixty-second spot, an advertiser would have 1 million seconds of time spent with the brand. If the same advertiser had only a quarter as many viewers watch all sixty seconds, the amount of total time spent with the brand would be 1.5 million seconds.

A larger number, yet with only 25% of the number of viewers.

On digital platforms, where viewers are in control of what they watch and when, time spent is starting to trump scale. How long viewers spend with a message is beginning to be recognized as offering just as much value as how many see it.

Instead of worrying about 90% skipping the message, advertisers should be thinking about how to get the 10% who do start to watch, to watch up to 90% of the message.

Because that’s the scale that’s going to matter as we head deeper into the digital age.

2009 should prove to be interesting, to say the least.

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